Best Veggie Burger Stocks to Buy

Best Veggie Burger Stocks to Buy: After decades of struggling to go mainstream, veggie burgers are starting to boom. Major restaurant chains now feature vegetarian options on their traditionally meat-centered menus, and diners are responding with enthusiasm.

Johnny Rockets, Red Robin, and White Castle were some of the first fast food establishments to gain recognition for their tasty veggie burger alternatives, and Burger King recently rolled out a veggie burger across the chain.

Even Dunkin’ has gotten on-board with a meat-free alternative to its popular sausage breakfast sandwich, and both McDonald’s and KFC are testing vegetarian menu options in pilot markets.

The question for investors is whether this trend will continue – and if so, what is the best way to be a part of it?

Meatless Burgers: The New Revolution

Consumers have been open to exploring vegetarian meals all along, whether out of concern for their own health or concern for the impact that eating meat has on animals and the environment. However, veggie burgers haven’t measured up in terms of taste and texture.

The ingredients were typically a combination of grains, beans, and mushrooms, shaped into a patty and doused with a complicated combination of spices. They simply didn’t satisfy when patrons craved a burger.

The new generation of veggie burgers has reinvented meat-free meals. They are completely plant-based, but they mimic the taste and texture of ground beef, sausage, and similar. This is key to their newfound success. Instead of focusing on appealing to vegetarians who are already committed to meat-free diets, the new veggie burgers are focused on appealing to consumers who eat meat and like it, but want to pursue a healthier lifestyle.

For investors, the veggie burger boom presents big opportunity – but which companies are most likely to grow and profit? Beyond Meat, Nestle, Impossible Foods, and Tyson Foods all want to corner the veggie burger market. Which is most likely to succeed?

Is Beyond Meat Stock a Buy?

Beyond Meat is on a mission, and it’s not to offer the best veggie burger available. This company is ready to go head-to-head with the $1.4 trillion global meat industry, offering meatless alternatives to consumer favorites that don’t require a change in lifestyle, habits, or dietary preferences.

Beyond Meat was founded in 2009 to explore opportunities for reducing the impact of meat production on human health, the environment, and animal welfare – and it is succeeding. In a study that compared the environmental impact of a Beyond Burger and a standard ¼ pound beef burger, Beyond came out ahead. Researchers found that Beyond Burger production requires 99 percent less water, 93 percent less land, and 46 percent less energy than meat-based options.

Today, Beyond Meat products can be found front and center on menus in some of the world’s most popular restaurants, and its May 2019 IPO was met with excitement. Stock prices have climbed more than 200 percent since trading began. Though analysts don’t expect these kind of gains in the coming year, there is every reason to believe the business will grow.

Beyond Meat is expanding its offerings in grocery stores nationwide, and it is aggressively building its international presence.

Better yet, a variety of fast food chains are conducting market research based on the Beyond’s veggie options. For example, McDonald’s is testing a Beyond Meat burger in Canada, and KFC is analyzing results from a one-day promotion of Beyond Meat’s veggie “chicken”.

All in all, it looks like Beyond Meat is going to be a strong contender in the increasingly competitive veggie burger industry. Growth appears inevitable, making Beyond Meat stock a smart buy.

Should You Invest in Nestle?

Nestle has been in the business of food since 1866, and its stock prices have gone steadily up.

The company owns large international brands like Gerber, Perrier, Cheerios, and Carnation. Clearly, its leaders aren’t going to ignore the latest trends in food. Nestle developed an answer to Impossible and Beyond Meat, introducing its Awesome Burger under the Sweet Earth brand. So far, the reviews have been outstanding.

There is something to be said for investing in a company with Nestle’s size and scope. It has mastered supply chain logistics, and it already has a path in place to put Awesome Burgers in grocery stores and restaurants worldwide. For investors, these advantages make Nestle a safer bet when buying into the veggie burger business.

However, because veggie burgers make up just a small fraction of Nestle’s business, this line is unlikely to dramatically impact net profits, no matter how successful it becomes.

Investors who want a stake in the success of veggie burgers without the risks that come with buying shares in small, single-focus companies should consider Nestle stock a buy.

How to Buy Impossible Foods Stock

Impossible says its story started in 2011 with a simple question: What makes meat taste like meat?

That question launched the company’s first product, the Impossible Burger, which is astonishingly similar to standard beef burgers in flavor, texture, and aroma.

However, it is made entirely from plants. There is plenty of protein without the saturated fat, and of course, by making the switch, consumers reduce the impact of meat production on animals and the environment.

Impossible Foods saw some success in its early years, but it didn’t get on investors’ radars until its partnership with Burger King. With the fast food giant’s decision to offer Impossible Whoppers, Impossible Foods became one of the most well-known meatless brands in the industry. In fact, its products are so popular, Impossible can’t keep up with demand.

The company recently signed a deal with a meat-production business to increase Impossible Burger production capacity.

Investors are anxious to participate in the company’s success, but for the moment, the opportunity just isn’t there. Impossible is privately held by a small group of investors, and it has closed its most recent round of financing. For now, there are no plans to go public, but that could change any time. Watch this space for updates on any future IPO announcements.

Is Tyson Foods a Buy?

Tyson Foods is something of a family business, despite its position as an industry giant. It was founded in 1935 by John Tyson, and it boasts three generations of successful leaders. Tyson specializes in protein, and it owns a portfolio of brands that include Jimmy Dean, Hillshire Farm, Ballpark, and Barber Foods.

The truth is, despite its long-term position as a market leader in many respects, Tyson is a bit behind the competition when it comes to veggie burgers and meatless protein alternatives. The company introduced some blended protein products in 2019 that combined Angus beef and pea protein to create healthier meat-based options. It has also announced a line of vegan protein products that will be sold under the brand Raised & Rooted.

Chances are that Tyson will see success with its plant-based protein products once production is truly up and running. As with Nestle, Tyson has the experience and infrastructure in place to get its foods into stores and restaurants around the world.

However, it remains to be seen whether Tyson can catch up to the competition in this niche food market, now that Beyond and Impossible have gained footholds in chain restaurants. While Tyson is still a reasonable choice for investors, those looking for exposure to veggie-based revenues would be better off with Beyond or Nestle for now.

Best Veggie Burger Stocks to Buy Summary

The bottom line is that consumers have longed for meat-free meals that mirror the taste and texture of classic dishes. The introduction of veggie burgers that are nearly indistinguishable from beef marks a turning point in the food industry. Now, consumers can live their values when it comes to the environment, animals, and personal health without making any sacrifices.

With all of this in mind, some industry analysts project that the meatless protein market may grow to $140 billion in the next 10 years. Smart investors are getting onboard now, in hopes of being in the right position to profit from growing demand. Of the current options available, Beyond makes good sense for those comfortable with a little more risk, while Nestle remains a solid choice for folks who need more stability.

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.